Has the Prime Minister studied the article by his son-in-law in this morning's edition of The Times, in which he states that whatever the short-term advantages of the Government's package, in the longer term there is no hope of reconciling full employment with stable prices unless the Government cut public spending by £3,000 million this year? As the Prime Minister presumably would not accuse his own son-in-law of lack of patriotism, will he at least clearly understand why the rapture on the Opposition side of the House is so modified?

The Government's views on the question of public expenditure are well known. Clearly public expenditure must be kept within bounds—as we have done by our recent decisions. There is a question that appeals to all of us on the Government side of the House—and, I hope, to some on the Opposition side—namely, that there must be priorities in public expenditure. That is what we are actively endeavouring to ensure in the policies that we are following.

Will my right hon. Friend reconsider the statement that he has just made—that public expenditure must remain within bounds? What on earth does he mean by that, when the country is now faced with mounting unemployment and we all know that the only way in which the Government will get a quick return to a full employment strategy is by making much more of our public resources available for this purpose?

As the Prime Minister has referred to the trade unions' co-operative attitude over pay policy, does he agree that the current pay settlement is at risk while the Government are continuing to borrow £1 out of every £5 that they spend.

No, Sir. I do not think that that analysis is correct, either. I look to neither the extreme Right nor the extreme Left in order to
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get a fair appreciation of these matters. What is happening at present is that Government expenditure, which is, of course, to a large extent—

That was not quite what I was about to say. I was about to say that it is based on the need to provide the necessary social infrastructure upon which our industrial system can depend. Because of that, I think it would be foolish to talk about large-scale cuts in public expenditure. What is much more important is that we should increase the rate of gross domestic production so that we can finance these needs out of the increase.

Does my right hon. Friend agree that when he is considering economic policy—and much has been said this week about the TUC and its responsibilities—he ought also to take into account the demands of the TUC for selective import controls, which would give a boost to employment in Britain?

I shall try once again. The Government have no ideological objection to selective import controls if they will rescue an industry from a situation in which it would be closed down, when in other circumstances it could be viable. However, in the case of general import controls, to which my hon. Friend did not refer, we do not believe that this is the best way to expand world trade, especially as Britain is such a large trader.

Is the Prime Minister aware that we welcome the fact that both he and the TUC have now recognised that the economic policies on which he fought the last two General Elections have proved disastrous for Britain? When will he learn the second lesson of the last two years—that borrowing must be cut and incentives must be restored if we are to stop getting poorer and start getting richer?

I find those remarks a little hard to take, when I
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remember that we came to power in the middle of a three-clay working week, which was brought about by the total incapacity of the Conservative Party to understand how industrial relations in Britain should be run, although the Conservatives were warned time after time, both publicly and privately, of their folly and of the catastrophe to which their policies would lead them. We reversed that policy. That is why, for two years running, we have secured the strongest bastion of all against inflation—that is a voluntary pay policy. [Interruption.] The House has got very bad tempered since the days when I used to listen to replies. I do not complain, but I must say that I should have thought that on the whole it was better to listen to answers.

In conclusion, I want to say that the overcoming of inflation is a national interest, and that it is something in which, now and again, I look to the Leader of the Opposition to support me.

If the Prime Minister is so complacent, will he take the advice of his right hon. Friend the Leader of the House and name the day for a General Election now? June is a very good month for the Tories, as doubtless he will recollect.

I can well understand that the Leader of the Opposition prefers to divert attention from the reality of the situation. This country has this week won a battle against inflation, but we have not yet won the war. I hope that the right hon. Lady will cease to think about General Elections until that war is won.

On a point of order, Mr. Speaker. I seek your guidance. The hon. Member for Kingston-upon-Thames (Mr. Lamont), in his supplementary question, referred to my right hon. Friend's relative. I hope that that habit will be deplored. Most hon. Members have relatives who play independent rôles in public life. I suggest that it is an infringement of their liberty, as well as of ours, to refer to them. If this habit is not against the rules of the House, it is certainly to be deplored and, I hope, avoided.